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The competition for keeping your job at Investec says something depressing to the whole market

In 30 days’ time, it will be the 28th of December and most people will be loosening their belts or visiting their in-laws. But at Investec, 85 people may be losing their jobs.

As the next step in the pained fusion of Investec and Evolution Securities, Financial News reports that Investec has put 85 of its 170 London investment bankers on a 30-day consultation period, starting last week. At the end of the 30 day consultation, the implication is that these people will probably be let go.

Investec declined to comment on this particular issue, but pointed us to a statement made on the 9th of September, when it said it intended to, “…reduce aggregate investment banking headcount to avoid unnecessary overlap with its existing activities whilst maintaining an appropriately sized employee base.”

There have already been rumours that Investec is planning to get rid of 140 out of 190 of Evolution’s broking staff during its purchase of the broker.

What’s occurring now looks like a pre-festive battle over who gets to stay in the combined organization. Headhunters predict much of the Investec blood will be let in cash equities, where Evolution staff will vanquish.

“Investec have bought Evolution for their cash equities business. There would be absolutely no point in letting the Evolution staff go,” says one.

Investec’s strategy is clear: it wants to be, “the leading mid-market investment bank in the UK.” It’s not going for league table status (it ranked 91st for European M&A, 41st for ECM and not at all for DCM): it’s going for niche success.

Away from cash equities, Investec staff are thought to be safe. Evolution doesn’t have a big fixed income or DCM offering, so overlaps are limited. Headhunters say it’s actually a great place to work, quietly entrepreneurial and innovative. “It’s a very flat structure and there’s a feeling that if you’re good at what you do, there’s no limit to how far you can rise within the organisation,” says one. “The culture is a bit like a hedge fund – everyone acts like they own the business.”

The pleasant Investec culture is unlike to prove much of a palliative for its cash equities staff in the run up to Christmas. The bloodletting at the two firms also says something unpleasant about the likely outcome of consolidation in the financial services industry as a whole: combined firms must cut costs, dramatically. Unfortunately, there could be a lot more of this to come in 2012.

Comments (7)

  1. Citi’s consultation period started as well and will end on 8th Dec apparently. The “few” hundreds redundancies reported in the press might actually turn out to be closer to 1000 in London. These people will also just find out just before X-mas.

    HRfromthetablerounde Reply
  2. Not very nice at all. But then, Investec have always prided themselves on being clinical and hard nosed in business. It’s the Boar way. Whatever. Why anyone would choose to work for them is beyond me. You have to feel sorry for the 85 folks.

  3. HRfromthetablerounde – Fortunately, you are poorly informed. You have managed to take a series of points, some of which are based on fact, thrown them into the air, and caught some bullsh*t

    Spouting half truths doesn’t do anybody any good in particular when we are talking about people’s careers

  4. To lose your job is bad news, to get ripped off on the compensation (as is often the case) is a double blow. Employees can take steps to maximise their compensation but few realise this is possible and how to do it.

    Catherine Gannon Reply
  5. “Investec have bought Evolution for their cash equities business. There would be absolutely no point in letting the Evolution staff go,”
    Why do you bother quoting clueless headhunters? The acquisition of Evolution was conducted primarily for their successful wealth management operation, not their unprofitable cash equities franchise which greatly overlaps the existing Investec brokerage operations.

  6. TheTruth – what exactly in my comment is BS? The consultation has been announced in the press and widely reported by now. The hundreds of redundancies are innevitable and widely accepted (every other bank has gone through 3-4 rounds this year / Citi hasn’t). The 1000 in London is not that far fetched even if speculation at this stage. I am not suggesting this is specific to Citi (as said evenyone else has laid off already and will probably do so again). So not sure what your rant is all about. Go take a chill pill and come back with something a little constructive if you are so well-informed.

    HRfromthetablerounde Reply
  7. The consultancy period is 30 days and it does not end on the 8th dec. You clearly do not know the actual start date of the process and therefore the correct end date. Nor the actual date of communication.

    Press suggests 900 EMEA redundancies across markets and banking. The number for London on its own is therefore considerably less. Therefore your ‘closer to 1000’ is simply wrong

    This isn’t about taking a chill pill – you are going to a public forum with an inaccurate story that concerns people’s careers. It’s not too much to ask for it to be true and accurate is it?

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